Obama budget includes concessions, seeks GOP deal

Updated
 
Obama budget includes concessions, seeks GOP deal
Obama budget includes concessions, seeks GOP deal
White House photo

Shortly after the 2012 elections, with the deadline for the so-called “fiscal cliff” on the horizon, President Obama started negotiations with congressional Republicans on strong footing – the White House’s initial offers, you’ll recall, were progressive enough to leave House Speaker John Boehner “flabbergasted” and Senate Minority Leader Mitch McConnell “bursting into laughter.”

There was a point, however, to the tactics. For years, Obama would try to start in the middle, and encourage GOP leaders to join him there. They refused, instead pocketing the president’s pre-emptive concessions and demanding more. In late 2012, Obama chose a new posture – start on the left, then move to the middle gradually while seeking Republican concessions.

Next week, the president will unveil a budget, and in the process, return to his previous – and heretofore, unsuccessful – negotiating postures.

President Obama next week will take the political risk of formally proposing cuts to Social Security and Medicare in his annual budget in an effort to demonstrate his willingness to compromise with Republicans and revive prospects for a long-term deficit-reduction deal, administration officials say.

In a significant shift in fiscal strategy, Mr. Obama on Wednesday will send a budget plan to Capitol Hill that departs from the usual presidential wish list that Republicans typically declare dead on arrival. Instead it will embody the final compromise offer that he made to Speaker John A. Boehner late last year, before Mr. Boehner abandoned negotiations in opposition to the president’s demand for higher taxes from wealthy individuals and some corporations.

Don’t overlook how important this is. The president, for good or ill, is once again returning to the negotiating table with pre-emptive concessions, offering cuts to Medicare (reducing payments to providers, including pharmaceutical companies, while asking more of higher-income beneficiaries) and Social Security (the chained-CPI plan you’ve no doubt heard about, which lowers payments through a less generous cost-of-living adjustment). In exchange, Obama expects Republicans to scrap the sequestration cuts and accept about $600 billion in new revenue through closed loopholes, limits on deductions, and ending tax breaks for industries like Big Oil.

If this sounds familiar, there’s a good reason for that – the White House is effectively rolling back the clock to December.

It was December, you’ll recall, that Obama offered a package deal to Speaker Boehner that looked awfully similar, if not identical, to this soon-to-be-released White House budget plan. Boehner seemed interested, but ultimately walked away, realizing that his far-right caucus wouldn’t accept the compromise.

What the president is doing, then, is offering Republicans another chance to accept the same deal.

This is not, by the way, how the budget process usually works. In fact, it’s largely backwards – the usual rules of the game dictate that the administration would present a budget plan that includes the president’s preferred vision, with no meaningful concessions at all. Congress would then quickly toss it in a circular file and policymakers would begin negotiations anew.

Obama is apparently trying to expedite matters, announcing in advance that he’s already prepared to cut social-insurance programs – to the deep disappointment of his base – in exchange for real concessions on revenue from Republicans.

What’s to stop GOP leaders from simply pocketing these offers and demanding more? Nothing, but the White House, at least for now, says that won’t happen – if Republicans won’t compromise, then the offers on Medicare and Social Security will simply be removed from the table.

For those of us who celebrate programs like Social Security and Medicare, and see no value in Republican demands for cuts, the budget strategy is disheartening, but really, very little has changed. In December, the White House already made the offer: entitlement cuts for revenue. The president and his team talked about it, put it on their website, and defended it. Republicans rejected it, insisting they weren’t prepared to accept any concessions.

And now the same plan is back, and GOP officials have another chance to say no.

Why would anyone, at the White House or anywhere else, think things will be different this time? Maybe, the argument goes, the process will be more constructive since the House GOP caucus is smaller now than it was in December. Maybe sequestration has increased the pressure. Maybe rank-and-file Republican lawmakers never heard about the president’s offer on social-insurance programs from their own leaders, so this is intended to be more explicit. Maybe Obama’s offer is intended to tell pundits, “See? I was willing to cut entitlements, but Republicans still won’t budge.”

Whatever the reasoning, the fiscal talks are apparently poised to begin once again.

Budget, Grand Bargain, Budget Policy and Budgets

Obama budget includes concessions, seeks GOP deal

Updated